MarketWatch.com - Pre-Market Indications

Thursday, April 28, 2011

Indications: U.S. stock futures fall further after data

Stock Assault 2.0 - Artificial Intelligence Stock Market Software

By Kate Gibson and Barbara Kollmeyer, MarketWatch

NEW YORK (MarketWatch) â€" U.S. stock-market futures fell further Thursday after data showing the economy weakened in the first quarter and jobless claims topping 400,000 for another week.

The Commerce Department said gross domestic product rose at a 1.8% annual rate between January and March, slower than the 3.1%-pace in the prior quarter. Separately, the Labor Department said those filing initial claims for jobless benefits rose 25,000 to 429,000 last week.

Stock futures were already lower amid a crush of earnings results as investors paused for breath after the prior two-day rally.

Futures for the Dow Jones Industrial Average /quotes/comstock/21b!f:dj\m11 DJM11 +0.06%   fell 20 points to 12,621, while futures for the Standard & Poor’s 500 index /quotes/comstock/21m!f:sp\m11 SPM11 +0.04%   slipped 2.4 points to 1,348.6. Futures for the Nasdaq 100 /quotes/comstock/21m!f:nd\m11 NDM11 -0.03%   shed 4.75 points to 2,404.25.

Bernanke: QE2 is not a panacea

Ben Bernanke says the Federal Reserve doesn't expect the end of QE2 to have a significant market impact, and that quantitative easing has been successful, but it was never intended as a cure-all.

On Wednesday, the Dow /quotes/comstock/10w!i:dji/delayed DJIA +0.57%  rose 0.8% to close at 12,690.96, its highest since May 20, 2008. The Nasdaq Composite /quotes/comstock/10y!i:comp COMP +0.09% knocked out a 2007 closing high to finish at its best level since Dec. 12, 2000.

Speaking at the Federal Reserve’s first post-statement press conference Wednesday, Federal Reserve Chairman Ben Bernanke said the central bank will maintain its easy monetary policy and isn’t mulling any quick policy moves to fight higher inflation or slower growth.

“I think to some extent Bernanke is walking a tightrope, and this time he managed to stay on the rope,” but he could face problems down the road, said Steen Jakobsen, chief economist at Saxo Bank.

For now, Jakobsen said he doesn’t see anything stopping the S&P 500 /quotes/comstock/21z!i1:in\x SPX +0.36%  from moving to 1,385, then 1,400, except the start of a true dollar crisis.

“If it moves from orderly to disorderly, we could have an equity impact” and a problem for the Fed, he said.

The dollar continued to lose ground in Asian and European trading hours, with the dollar index /quotes/comstock/11j!i:dxy0 DXY -0.0068%  lately off to 73.16. The dollar index measures the greenback against a basket of six major currencies.

Gold prices continued to gain on back of dollar weakness, with June futures /quotes/comstock/21e!f:gc\m11 GCM11 +0.31%  up $14.50 to $1,531.60 an ounce on Nymex.

The corporate schedule was full, with a flood of earnings results and a deal announced ahead of the open. Exelon Corp. /quotes/comstock/13*!exc/quotes/nls/exc EXC +1.66%  will acquire Constellation Energy Group Inc. /quotes/comstock/13*!ceg/quotes/nls/ceg CEG +5.71%  in a stock deal valued at about $7.9 billion, the companies said in a statement.

Shares of Akamai Technologies Inc. /quotes/comstock/15*!akam/quotes/nls/akam AKAM -14.74%  sank in preopen trading. The company said late Wednesday that first-quarter profit rose almost 24%, but its second-quarter outlook fell short of Wall Street estimates.

Shares of Sprint Nextel Corp. /quotes/comstock/13*!s/quotes/nls/s S +6.68%  rose in premarket trading after the wireless company reported a first-quarter loss of 15 cents a share.

Shares of Aetna Inc. /quotes/comstock/13*!aet/quotes/nls/aet AET +4.12%  gained before the bell, after announcing a 4% increase in first-quarter profit and said it will buy Prodigy Health Group, a third-party administrator of self-funded health plans, for $600 million.

Shares of Dow Chemical Co. /quotes/comstock/13*!dow/quotes/nls/dow DOW +1.98%  added in the premarket after the company reported a higher first-quarter profit.

U.S.-listed shares of Deutsche Bank AG /quotes/comstock/13*!db/quotes/nls/db DB +5.29%   /quotes/comstock/11e!fdbk DE:DBK +5.06%  climbed in premarket trade after the company said its first-quarter profit rose 17%, helped by a string of acquisitions. Read about Deutsche Bank’s results.

But U.S.-listed shares of SAP AG /quotes/comstock/13*!sap/quotes/nls/sap SAP -6.94%   /quotes/comstock/11e!fsap DE:SAP -6.50%  tumbled in preopen trading after the German software group posted a 4% increase in net profit, but missed analysts’ forecasts.

After the close of markets, Microsoft Corp. /quotes/comstock/15*!msft/quotes/nls/msft MSFT +1.25% is due to report its quarterly results.

In overseas markets, European stocks traded higher, supported by well-received corporate updates from Deutsche Bank, Banco Santander /quotes/comstock/13*!std/quotes/nls/std STD +2.63%   /quotes/comstock/06x!e:san ES:SAN +1.49%  and Bayer AG /quotes/comstock/11e!fbayn DE:BAYN +2.21% . Read about Europe markets.

Stocks jumped in Tokyo, but Shanghai and Hong Kong markets fell. Read about Asia markets.

/quotes/comstock/21b!f:dj\m11 /quotes/comstock/21m!f:sp\m11 /quotes/comstock/21m!f:nd\m11 /quotes/comstock/10w!i:dji/delayed /quotes/comstock/10y!i:comp /quotes/comstock/21z!i1:in\x /quotes/comstock/11j!i:dxy0 /quotes/comstock/21e!f:gc\m11 /quotes/comstock/13*!exc/quotes/nls/exc /quotes/comstock/13*!ceg/quotes/nls/ceg /quotes/comstock/15*!akam/quotes/nls/akam /quotes/comstock/13*!s/quotes/nls/s /quotes/comstock/13*!aet/quotes/nls/aet /quotes/comstock/13*!dow/quotes/nls/dow /quotes/comstock/13*!db/quotes/nls/db /quotes/comstock/11e!fdbk /quotes/comstock/13*!sap/quotes/nls/sap /quotes/comstock/11e!fsap /quotes/comstock/15*!msft/quotes/nls/msft /quotes/comstock/13*!std/quotes/nls/std /quotes/comstock/06x!e:san /quotes/comstock/11e!fbayn

Kate Gibson is a reporter for MarketWatch, based in New York. Barbara Kollmeyer is an editor for MarketWatch in Madrid.

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No Buyers for Treasuries or Toxic Waste

Stock Assault 2.0 - Artificial Intelligence Stock Market Software

We believe there will be something similar to a QE3 by another name and the Fed will probably have to create some $2.5 trillion to buy Treasuries, Agencies, and toxic waste and perhaps inject funds into the economy. Japan certainly won’t be a buyer and probably will be a seller. China has indicated that they won’t be purchasers in the future either. The question also arises concerning the continued purchase of these securities by countries in the oil producing Gulf States, which are in turmoil. The three countries make up 45% of Treasury purchases. As we pointed out in previous issues the second half of 2011 should be monstrous. Even if the fed buys all the Treasury and Agency bonds they’ll still have to deal with a lower dollar and high inflation. Then there is high unemployment and raging gold and silver prices. There is also the question of US debt, federal, state and municipal debt, along with wars in the Middle East and North Africa. How many US Treasuries will Japan have to sell and how deeply will its slowdown effect American industry? As you can see America has much to contemplate.

The creation of monetary inflation will last at least two more years. Its end will only come when the Fed takes its foot off of the pedal. Like almost zero interest rates this policy cannot be allowed to stop. The system cannot function without it. The whole concept of throwing money at a problem simply doesn’t work and the elitists know this only too well.

Monetary and fiscal creations are not the only mistakes being made by the Fed and our Congress. US and world markets are being subjected to non-stop manipulation. This corruption has destroyed all free markets. Stock and bond markets are supported and gold, silver and commodities attacked. Fortunately markets now recognize what the elitists are up too and each time they interfere they lose a little more power. It points up that a criminal syndicate is running our country. These tactics are used to extend the looting period allowing further harvesting of elicit profits. The US and many other nations have been allowed to live beyond their means for many years and that condition is being brought to a conclusion. This, of course, is very true of the US due to the dollar being the world’s reserve currency. That is changing, as nations want this unfair advantage ended, especially in view of the fact that the American government and financial community have so abused their priv ilege.

The profits of the military industrial complex continue to flourish as we have war after war. We notice that both parties are willing to cut spending on Social Security and Medicare, but they refuse to cut military spending, the most expensive item on the budget at 26%. Our government has billions for Fannie Mae, Freddie Mac, Ginnie Mae, the FHA, the FICA and the worthless SEC and CFTC, but no cuts for the average American.

As zero interest rates rule one form or another of money and credit creation continues as it has for the past 11 years. The game is the same, it is just the name has changed. The process of wealth destruction is still in progress and only the select few get to keep their ill-begotten riches. The Fed’s balance sheet over the next 1-1/2 years should reach over $5 trillion.

On this process real interest rates will creep higher, toxic securitized mortgage bonds will fall lower, as the housing market sinks to new lows not able to break out of its death spiral.

We find it of great interest but not surprising that the $5 trillion mortgage bond fraud, after three years, has no prosecutions, or even a civil suit. This smacks of evidence that the Fed made some kind of sub-rosa deal with bond buyers, particularly in Europe, to cover their losses. In addition, we believe the Treasury and the SEC were in on the criminal fraud.

We see Warren Buffett doing the same thing that the Chinese are doing and that is dumping US dollars. He has been going to Asia and India to buy companies. This is how they both bet against the dollar. Buffett even says, “I would recommend against buying long-term fixed-dollar investments.” He says over the next 20 years the dollar will lose its value. This is also what we have been preaching over the past 11 years, and that the preferred investment should be gold and silver coins, bullion and shares. Professionals are concerned about the trade deficit and the balance of payment’s deficit, along with the continual creation of money and credit by the Fed. Then there is the horrible budget deficit and the rampant inflation the government continues to lie about.

Even PIMCO, as we all now know, has sold US Treasuries and even shorted them in anticipation of higher real interest rates. Bill Gross, CEO, calls the US a serial abuser of finance deficits with a ridiculous budget. He, like many others, has lost faith in the Fed and the government to run a proper government fiscal and monetary policy. Bill called it the new normal. We call it the road to fiscal and monetary perdition. Confidence is gone and well it should be. We lost confidence in 1960; it obviously takes others longer.

In our minds there is no question the dollar is going lower, perhaps 40% or 50% lower versus other currencies in general. In just the last 15 years it is 50% lower. In the last 40 years it is 98% lower. At this juncture it is our opinion that the Treasury and the Fed want the dollar lower in order to become more competitive. If they are going to do that they had best end their 60% plus reliance on foreign oil and start pumping America’s vast oil and gas reserves. They will also have to end free trade, globalization, offshoring and outsourcing in order to bring those 430,000 firms that have moved to foreign countries.

As the dollar falls against other currencies, all currencies continue to fall versus gold and silver. Over the past 11 years, annually, nine major currencies have fallen more than 20% on average versus gold and silver. If the dollar over the next several years were to lose its status a world reserve currency costs for foreign goods would rise exponentially. The only reason the dollar isn’t lower is that many other currencies have the same problems the dollar has in varying degrees. The dollar is very weak versus the euro at $1.46. Yet, the eurozone countries are exploding in debt and six of their members are candidates for insolvency. Japan, the UK, and parts of Europe have the same problems the US has - a hangover from using the Keynesian economic model. As a result of this misguided policy in ten years federal debt will be close to $20 trillion, up 75% from today. Is that anyway to fiscally run a country? The answer is obviously not. This is why the Fed has to buy 80% of Treasury and Agencies and it is why there is no end in sight to America’s fiscal and monetary problems. Just about everything is being done incorrectly, which tells us again this has been done deliberately in order to bring the US, UK and Europe to their knees economically in order to force the people in these countries to accept World Government. The experiment again is not going to work and chaos and war will again envelop the world. You had best be prepared.

How can investors be positive about dollar denominated investments, when S&P warns government that they had best get their financial house in order or they will lose their AAA rating. They placed the US outlook as negative. The US has to address medium and long-term budgetary problems over the next two years and if they don’t the rating will fall and the US will no longer be the world’s reserve currency. Monetary policy cannot continue to augment, aid and abet such a profligate fiscal policy, which can easily be changed by cutting military spending by 50% to 13% of the budget. That is not easy to do with the military-industrial complex, Wall Street and banking running the country. Their greed knows no end.

We just saw over the past three years a credit crisis and a crisis of confidence for both the government and private debt sectors, which still hasn’t been permanently addressed. Many major financial firms are still insolvent and carrying two sets of books. If you did that you would end up in jail.

The Fed has become a liability in its quest to protect its owners, the banks, and not the overall economy. It is instrumental in destroying debt quality and continues to destabilize the monetary base. There is no effort to cut military spending only Social Security and Medicare, which retirees and future retirees paid for, but those funds were stolen over the years.

How does any Fed call allowing mortgage debt to expand by $8 trillion or by 115% over six years? They the banks and brokerage houses knew exactly what they were doing and what the consequences would be. Banks employed leverage of 70 to 1 when 9 to 1 was normal and it is still 40 to 1. Obviously the bankers have learned nothing from their failures. In addition, besides us, how could rating agencies and professionals not recognize a Ponzi scheme? That is because S&P, Moody’s and Fitch were part of the criminal enterprise. How could a credit system double debt, most of it was of very poor quality and expect that there would be no fall out? They knew the consequences and did it anyway. In the aftermath there has been no civil litigation and no criminal prosecutions. Why is this? It is because these criminals have bought most of Congress and the court system.

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NYSE Arca Morning Update - 08:30:00 ET

NYSE Arca Morning Update for Thursday, Apr 28, 2011 :

STOCKS TRADING ON NYSE Arca AT A PRICE 15% OR MORE AWAY FROM
THE PREVIOUS TRADE DAY'S CONSOLIDATED CLOSE PRICE (AS OF 08:30:00 ET)

Stock Wednesday's Close Current Price Pct Change Current NYSE ARCA Vol
VTAL $14.19 $18.67 31.5% 21,500
ESLR $2.07 $1.52 (26.6%) 31,899
LFT $17.70 $20.65 16.7% 16,024
INSP $8.77 $10.19 16.2% 6,600


10 MOST ACTIVE STOCKS ON NYSE ARCA AS OF 08:30:00 ET

BASED ON DOLLARS TRADED: | BASED ON SHARES TRADED:
Stock $ Volume Price PctChg | Stock Share Vol Price PctChg
SPY $49,177,385 $135.38 ( 0.2%) | S 3,057,815 $4.95 3.3%
SLV $27,163,235 $47.04 0.1% | SLV 575,315 $47.04 0.1%
IWM $19,645,415 $85.67 ( 0.0%) | SPY 363,130 $135.38 ( 0.2%)
S $15,268,837 $4.95 3.3% | TFM 235,235 $42.69 ( 1.8%)
BIDU $12,165,786 $153.84 1.8% | IWM 229,220 $85.67 ( 0.0%)
GLD $11,316,320 $148.83 ( 0.2%) | EK 202,817 $2.93 ( 7.6%)
TFM $10,107,323 $42.69 ( 1.8%) | AKAM 149,575 $35.89 (12.4%)
AKAM $5,379,897 $35.89 (12.4%) | C 149,400 $4.50 ( 0.3%)
AAPL $5,211,581 $348.58 ( 0.5%) | RPC 146,835 $0.58 39.0%
TCLP $5,068,597 $47.95 ( 3.3%) | ALU 131,065 $6.39 ( 1.7%)


Price changes may be affected by symbol splits and dividends.

Consolidated close price is the last print (excluding prints with trade
conditions) prior to 4PM ET.

This information is also updated on our web page every morning at 8:35ET:
http://www.tradearca.com/data/volume/daily_update.asp

This material is for informational purposes only.
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